Sugar prices rise sharply as cane supply declines

The price of sugar in various supermarkets in Kenya such as Naivas has risen by approximately Sh35 to Sh125 per kilo up from Sh90 in June occasioned by low cane supply and the current crackdown on contraband sugar in the market.

In retail shops, a kilo of sugar is sold at Sh150 with wholesalers selling a 50kg bag of the commodity at Sh6,000 leaving a profit margin of Sh20 to Sh30 for every kilo sold.

According to the Economic Survey 2018 the area under cane reduced to 191.2 thousand hectares last year compared to 220.8 thousand hectares in 2016.

Reduction in cane area was attributable to conversion of some area under cane to other crops such as maize, soya beans and beans. Further, the quantity of cane delivered to factories reduced by 33.3 per cent from 7.2m tonnes in 2016 to 4.8m tonnes in 2017.

This was on account of prolonged dry weather conditions which were unfavorable for the growth of cane leading to harvesting of immature cane. As a result, the average sugarcane yield reduced to 55.3 tonnes per hectare in 2017 compared to 62.2 tonnes per hectare in 2016, representing a decrease of 10.9 per cent.

The total domestic sugar production declined by 41.2 per cent from 639.7 thousand tonnes in 2016 to 376.1 thousand tonnes in 2017. A total of 989.6 thousand tonnes of sugar was imported in 2017 to bridge the deficit occasioned by the low production during the year. Most of the sugar imports were meant for final consumption at 83.1 per cent of total sugar imports.

Consumers are now turning to honey to sweeten their tea due to the increase in sugar.

Lydia Kosgei, a consumer in Uthiru for instance has resorted to using raw honey which costs her Sh600 per kilo.

“Since I heard of presence of metals such as mercury in sugar sold within the country, I no longer trust the retailers and thus I prefer my local honey,” said Kosgei.